Singapore’s FAST-P energy transition fund has raised US$250 million at first close to support infrastructure projects across Asia.
The Energy Transition Acceleration Finance partnership, or ETAF, is a blended finance fund under Singapore’s Financing Asia’s Transition Partnership initiative.
It is backed by the Monetary Authority of Singapore (MAS), Clifford Capital and the Private Infrastructure Development Group.
The first close is for ETAF’s displacement strategy, which will fund grid modernisation and other infrastructure projects that can help reduce reliance on fossil fuel-based power generation.
ETAF also has a replacement strategy focused on replacing coal-fired power generation with lower-emissions power sources.
Blended Finance for Transition Projects
The fund uses blended finance and risk-sharing structures to bring capital into transition infrastructure projects that may be at an earlier stage or carry higher risks.
These projects often struggle to secure financing at the scale, tenor or risk appetite needed.
MAS and the Private Infrastructure Development Group are the catalytic capital providers for the first close.
Temasek is also expected to contribute catalytic capital through its Concessional Capital for Climate Action, subject to definitive agreements.
DBS Bank is participating as a senior lender, while GuarantCo, part of the Private Infrastructure Development Group, has provided a guarantee for the fund’s mezzanine financing structure.
Clifford Capital Asset Management will manage ETAF.
“ETAF’s successful first close demonstrates FAST-P’s growing momentum and traction.
Through innovative blended finance models and guarantee mechanisms, FAST-P is bringing a broader coalition of partners together to meet Asia’s transition financing needs,”
said Gillian Tan, Assistant Managing Director for Development and International at MAS
The Singapore government has pledged up to US$500 million in concessional capital under FAST-P, with the aim of catalysing up to US$5 billion in investments to support Asia’s green transition.
Featured image: Edited by Fintech News Singapore, based on image by LensMastersCollection via Magnific
